Delhi High Court - Orders
M/S. Prl Projects And Infrastructure ... vs Additional Commissioner, Central Tax ... on 22 August, 2025
Author: Prathiba M. Singh
Bench: Prathiba M. Singh
$~43
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 12732/2025
M/S. PRL PROJECTS AND INFRASTRUCTURE LIMITED
AND ORS .....Petitioners
Through: Mr. Siddharth Malhotra, Adv.
versus
ADDITIONAL COMMISSIONER, CENTRAL TAX AND CGST
DELHI WEST AND ANR .....Respondents
Through: Mr. R. Ramachandran, SSC with Mr.
Prateek Dhir, Adv.
CORAM:
JUSTICE PRATHIBA M. SINGH
JUSTICE SHAIL JAIN
ORDER
% 22.08.2025
1. This hearing has been done through hybrid mode. CM APPL. 52065/2025 (For Exemption)
2. Allowed, subject to all just exceptions. The application is disposed of. W.P.(C) 12732/2025
3. The present petition has been filed on behalf of the Petitioners under Articles 226 and 227 of the Constitution of India, inter alia, challenging the impugned Order-in-Original dated 03rd March, 2025, passed by the GST, Delhi West Commissionerate, Delhi. The said order arises out of the Show Cause Notice ('SCN') dated 13th October, 2021, issued by the Directorate General of Goods and Services Tax Intelligence, Jaipur ('DGGI').
4. A brief background of the present case is that the Petitioner No. 1 registered as an assessee with the Service Tax department on 21st June, 2012. However, on 1st September, 2017, the DGGI initiated investigation against the Petitioner No. 1. The said investigation concluded in April, 2019. However, W.P.(C) 12732/2025 Page 1 of 4 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/08/2025 at 23:27:26 the investigation qua the Petitioner No. 1 was reopened and continued till October, 2021. On 13th October, 2021 a SCN was issued by the DGGI to the Petitioner No.1.
5. It is stated that on 12th January, 2023 the Petitioner No. 1 filed a response to the SCN. However, the impugned Order-in-Original dated 3rd March, 2025 was passed, vide which, penalties were imposed on the Petitioners.
6. The case of the Petitioner is that the mandatory pre-consultation notice was not issued to the Petitioner. The Petitioner is stated to have filed a detailed reply and also raised this objection before the department. However, the same is not considered in the impugned order dated 03rd March, 2025 and a demand has been raised against the Petitioners to the tune of Rs.1,25,35,760/- along with certain penalties.
7. Issue notice. Mr. R. Ramchandran, ld. SSC accepts notice.
8. In the decision, Amadeus India Pvt. Ltd. v. Principal Commissioner, Central Excise, Service Tax and Central Tax Commissionerate [(2019) SCC OnLine del 8437] the Court, inter alia, set aside the show cause notice therein, on the ground that a pre show cause consultation was not provided to the Petitioner therein. The relevant portion of the said decision is extracted hereunder:
"15. In any event, as far as the present case is concerned the officers of the respondent do not appear to have taken any conscious decision in regard to the requirement of the master circular. A pointed question was posed by the court to Mr. Harpreet Singh whether prior to issuing the impugned SCN, a decision was taken by the respondent in the light of para 5.0 of the master circular not to undertake the pre-notice W.P.(C) 12732/2025 Page 2 of 4 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/08/2025 at 23:27:26 consultation. After going through the notes in file, Mr. Harpreet Singh stated that there was no noting in the file to that effect. In other words, it appears that the respondent completely ignored the master circular before proceeding to issue the impugned SCN.
16. The mandatory character of the master circular can be traced to section 83 of the Finance Act, 1994 which makes section 37B of the Central Excise Act, 1944 applicable in relation to service tax. In terms section 37B of the Central Excise Act, 1944 instructions issued by the CBEC would be binding on the officers of the Department.
17. The legal position in this regard is well-settled. Illustratively a reference may be made to the decision in State of Tamil Nadu v. India Cements Ltd. [2011] 40 VST 225 (SC) ; (2011) 13 SCC 247 (SC). Specific to the master circular, a reference may be made to the judgment dated February 9, 2018 passed by the High Court of Judicature at Madras in W. P. (C). No. 11858/ 2017 (Tube Investment of India Ltd. v. Union of India [2019] 69 GSTR 78 (Mad)). In that case, after noticing that para 5.0 of the master circular was not adhered to, the High Court set aside the SCN challenged and delegated the parties to stage prior to the issuance of the SCN.
18. In the present case, the court is satisfied that it was necessary in terms of para 5.0 of the master circular for the respondent to have engaged with the petitioner in a pre SCN consultation, particularly, since in the considered view of the court neither of the exceptions specified in para 5.0 were attracted in the present case.
19. Accordingly, without expressing any view on the merits of the case of either party in relation to the issues raised in the impugned SCN, the court sets aside the impugned SCN dated September 4, 2018 and relegates the parties to the stage prior to issuance of impugned SCN. The respondent will now fix a date W.P.(C) 12732/2025 Page 3 of 4 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/08/2025 at 23:27:26 on which the authorised representative of the petitioner would be heard in relation to the issues highlighted in the submissions dated August 24, 2018 of the petitioner in response to the communication in dated August 20, 2018 addressed to it by the respondent. Needless to state that the petitioner will extend its full cooperation to the respondent by providing the necessary information."
9. In view thereof, the impugned Order-in-Original dated 03rd March, 2025 shall remain stayed.
10. List on 24th November, 2025.
PRATHIBA M. SINGH, J.
SHAIL JAIN, J.
AUGUST 22, 2025/pd/dk/rks W.P.(C) 12732/2025 Page 4 of 4 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/08/2025 at 23:27:26